May 21st, 2007
The key theme of industry researcher Gartner’s conference in London earlier this year was â€œStrategic Multisourcingâ€ or the ability to work with multiple vendors for undertaking all the contextual work that that is better left to third party providers, while a company focuses on what is truly core to its own operations.
For many of the Fortune 1000 and FTSE 100 companies, this is not a new theme, for some of them have developed and sustained outsourcing relationships with half-a-dozen or more partners, for over a decade now.
One question that has dominated discussions in the past and becomes even more relevant for smaller firms is the choice between multiple partners and building a wide and deep relationship with a single trusted source.
The logic for multisourcing is compelling the ability to work with best of breed providers in each specific segment, the commercial advantage of â€œkeeping the vendor honestâ€ by always having multiple mature options, and having the flexibility to move work from internal departments to vendors and even across providers whenever the need arises.
The flip side to this advantage is of course the time and effort is takes to develop mature relationships with multiple sources.
Recent trends in technology too have made it beneficial to invest a lot in the initial selection process and draw up mutually agreed service-level agreements and productivity improvement plans and then focus on building a truly collaborative single source outsourcing relationship.
The new centres will deploy a new framework that enables the work done for clients to be distributed, with analyses of requirements done at the clientâ€™s premises, architecting and designing of solutions at one of the three new centres, development of the applications at full-service facilities using generative techniques rather then “brute force programming,” and testing of applications at one or more locations as seen most appropriate by the client.
This approach leverages the power of the Internet to perform work where it makes most sense, keeping in mind the proximity desired by any client at the analysis and testing stages and the cost and robust quality processes available at large offshore centres in actual system development.
The debate will continue but the message is clear outsourcing is becoming more and more key to the business fortunes of any firm and the more strategic and collaborative it can be, the better!
Entry Filed under: Why Outsource?